April 12, 2007

THUS ENDS THE CHINESE MIRACLE:

China union drives harder bargains: The sole workers' group is newly aggressive on wages and conditions, worrying foreign firms (Evelyn Iritani, April 12, 2007, LA Times)

China's government-backed trade union, long considered a paper tiger, is growing real fangs — delighting worker advocates but making foreign executives sweat.

Dismissed for years as a Communist Party mouthpiece and organizer of holiday parties, the All-China Federation of Trade Unions has started playing hardball, pushing for tougher labor protections and launching an aggressive campaign to organize foreign companies that have benefited from the country's large, low-cost labor pool.

The federation recently took on some of America's biggest fast-food franchises, accusing McDonald's Corp. and Yum Brands Inc., owner of KFC and Pizza Hut, of underpaying teenagers in their outlets in Guangdong province, where the union has been trying to set up branches. Provincial officials cleared the companies this week, but the dispute made big headlines and highlighted the union's activism. [...]


By teaching workers their legal rights, such as the minimum wage and overtime pay, the union is having a positive effect on wages and working conditions in places like Guangdong, said Chang Hee Lee, an industrial relations expert in China.

In the past, union representatives were chosen by company management and signed off on wage contracts without consulting employees. But Lee recounted a recent visit to a small food-processing plant where the employees had persuaded the union to hold an election for a workers' representative to negotiate on their behalf.

"This emboldens workers," he said. "They say, 'Yes, I have bargaining power.' "


No cheap labor? No jobs.

MORE:
Poor Romania Imports Poorer Workers: Now that they're residents of an EU member country, low paid workers are leaving the Balkan nation in search of higher wages (Matthew Brunwasser, 4/12/07, Business Week)

To get around the chronic labor shortages hampering this traditional textile center and in other industries across Romania, Sorin Nicolescu, who runs a clothing factory, came up with an original solution: import 800 workers from China.

"The explanation is very simple," said Mr. Nicolescu, general manager of a Swiss concern, the Wear Company. "We don't have any Romanian workers because they have all left to work" in Western and Central Europe. [...]

Romania, a nation of 21.6 million (and declining 0.2 percent annually)...

Posted by Orrin Judd at April 12, 2007 7:57 AM
Comments

"This emboldens workers," he said. "They say, 'Yes, I have bargaining power.' "

Pretty soon, these emboldened workers will bargain with the Communist Party, and strike against govt. policies. The genie will not be pushed back in the bottle.

Posted by: ic at April 12, 2007 1:51 PM
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